Cash - Flow Analysis - Sam Method: Fill & Download for Free

The Big Picture Business PlanMeet your customer:Brainstorm and think of three fictional characters who would either walk into your office or call you on your phone to avail your service.Make two such characters and be as descriptive as possible. Give them names like John and Rita, and you will begin to analyze what motivates them to use your service, which we will touch upon this next.Consider obtaining actual data through surveys and secondary research as much as feasible.Pain point:Start with putting yourself in the shoes of your customer, and write down the main pain points your event management company can solve.Your solutions:Make a list of the products and services that your company has on offer to solve those problems. What kinds of events you cover, what kinds of events you don't. Who ELSE provides similar services.Your USP:Find out what makes you different from your competition and write these down, this will be needed towards your brand positioning, and marketing. Apple and HP both sell Laptops, but we are able to differentiate them from one another because of our perception.This differentiation is what you need to create internally and externalize through marketing. If you don't have the answer yet, look closer to the customers and gauge from them what they don't like about your competitors. You can use this information for doing a S.W.O.T analysis, of your key competitors.Analyze rivals:This step is VITAL, no other step throws better light on how the market currently works better than this one. Find out as much as possible about your rivals. Who are the largest event management companies you are looking to compete against?Write down their names, and analyze aspects of their business like Sam Walton of Walmart used to do. Sam Walton would go out to every possible convenient store anywhere he went to understand why shelves were kept the way they were, how customers behaved, how counters were lined up. I'm not asking you to engage in espionage, but pretend to be a customer and write down what you like and don't like about them.Next, get information to the extent available on their customer base, market share, financials, market positioning, and use this to identify which is their strength, weakness, opportunity, and threat.You will now have a strong understanding as to what your strategy could be towards getting paying customers for your event management company vis-a-vis your rivals.Define your value chain:With the help of competitor analysis, product differentiation, and identification of customer demographics, build a flow chart of activities your company will need to perform to deliver your products and services to your customer. This will form part of your Operations plan.Think through the number of people you would like to have in your team versus budget constraints, which we will cover shortly in the financials section. What are the different roles of people within your company, what are the open positions?Business mentors and advisers:Get a list of experienced people you know or areas you need some one experienced for help. When things go well, there is no requirement for such people, but every business regardless of size uses the help of advisers, such as qualified accountants and lawyers. If you don't know any think of talking to business consultants for advise at a fee. Keep these contacts as references too, which adds leverage to your company's success.Financial Model and Valuation:a) BudgetThis step is crucial for you to understand how you can manage your finances for the company. The first part here is to prepare a list of the possible expenses you can incur. Next put currency amounts next to each expense and write whether it is fixed, (i.e. something you have to incur, and is not directly related to sales, e.g. rent and payroll cost) or variable (something tied to sales, e.g. sales commissions and advertising costs).b) Sales forecastHere, you have to estimate what potential sales you have to make for at least five years. It's not that difficult, here's what you can do.Get analyst estimates in your industry through internet searches, several governmental bodies release reports for free. Get what's available, add assumptions and run with it. Now you have the size of the pie, and the rate it will grow.Next, look at the potential market share you intend to have 5 years from now. For any growing company, your growth in sales should be higher than the industry overall at least as a target. If you find this challenge use the help of an expert to build this revenue model.c) Financial Statements and Ratio AnalysisPretty intuitive, once you have the above data, you will need to use it for making proforma financials including Income statement, Balance Sheet and Cash Flow Statement for 5 years and perform ratio analysis such as DSCR, ROI, DSO, CCC, etc.d) Valuation (Optional)This is especially required if you need to raise equity funding. There are several different possible methods such as Relative Valuation, DCF, and other more recent ones such as the Berkus method and VC method. You can google search and find suitable templates too.ConclusionIt's easy to be overwhelmed with the exercise of building a Business Plan, but with the information you have for your event management company from above, you will be in a strong position to draft a business plan, which can be either used for internal strategy or obtaining loan or equity financing.I wish you all the best!

I don't know when you will be rich but according to various reports, articles and notable people, here are 365 ways to get rich!#1Sir John Templeton: “Invest at the point of maximum pessimism.”#2Don’t mistake a low P/E ratio for a value stock.#3Benjamin Graham: “Patience is the fund investor’s single most powerful ally.”#4Let your attorneys ride shotgun, but not in the driver’s seat.#5Remember Enron; reduce your employer’s company stock in your 401(k).#6Warren Buffett: “Rule No. 1 is never lose money. Rule No. 2 is never forget Rule No. 1!”#7Fund a Roth IRA if you’re eligible; your money grows tax free for retirement, and in an emergency you can take your contribution back without penalty.#8Barry Sternlicht: Pay attention to the big themes, because they are what will help you earn ten times your money.#9Back a friend or relative’s startup with a convertible loan, so you share in the upside.#10Use commodities as a hedge against inflation.#11Raise the deductibles on your auto and home insurance.#12Form family limited partnerships to transfer assets at a tax discount.#13Beat death taxes in 20 states by making big gifts while you’re alive.#14For simple federal tax-free wealth transfer, make $14,000 annual gifts to children and grandchildren. It won’t cut into your $5.25 million lifetime exemption from gift and estate taxes.#15Get tax advice before settling a lawsuit.#16Read Reminiscences of a Stock Operator by Edwin LeFèvre.#17To keep peace with both relatives and the IRS, document all family loans.#18Peter Lynch: “Never invest in any idea you can’t illustrate with a crayon.”#19View collecting as a hobby first and investment second; psychic returns can make up for a lower average return than in stocks.#20Add a personal items floater to your homeowner’s insurance to cover collectibles.#21When the bear charges, stand your ground.#22For protection from inflation and currency devaluation, buy the “gold you can eat”—farmland.#23Know your risk tolerance. Pick an asset allocation that lets you sleep at night, so you won’t panic and sell stocks at the bottom.#24Don’t keep too much in cash equivalents—over time, this “safe” investment barely keeps up with inflation.#25After setting an asset allocation, rebalance yearly; it forces you to take profits when stocks have surged and to buy more shares when they’re cheap.#26Benjamin Graham: “Adopt simple rules and stick to them.”#27Buy Bitcoin as a speculation or political statement, not a hedge.#28Be a tax-smart investor. Hold taxable bonds in a 401(k) or IRA. Put individual stocks in taxable accounts so you can sell losers to harvest tax losses.#29Pay attention to the IRS’ wash sale rule when harvesting capital losses.#30Don’t invest in a hedge fund unless its audited results are reported in compliance with Global Investment Performance Standards.#31Build an emergency fund outside your 401(k).#32For the biggest tax break when donating collectibles to charity, make sure they’ll be displayed and not sold.#33Put alternative investments like real estate (but never collectibles) in your IRA.#34Burton Malkiel: “All index funds are not created equal. Some have unconscionably high expenses.”#35Keep an eye on—but don’t obsess over—mutual fund fees and expenses.#36Even committed indexers should use actively managed funds to buy municipal and high-yield bonds and value stocks.#37Yield is nice, but total return is the metric that matters.#38Gold is overrated as an inflation hedge—historically, its price moves are unrelated to inflation.#39For inflation protection, buy floating-rate corporate bonds.#40Don’t let the mood swings of Mr. Market coax you into speculating.#41Beware affinity fraud; find God, not hot investments, at your church, synagogue or mosque.#42Sir John Templeton: “The four most dangerous words in investing are: ‘this time it’s different.’”#43Don’t put more than you can afford to lose into a crowdfunded deal; startups are always risky, and the new JOBS Act reduces both paperwork and investor protection.#44Don’t underrate the importance of liquidity.#45Use Quicken or a Web service to track all your finances and see your big picture.#46Use different passwords for each of your online financial accounts; add optional security questions whose answers can’t be found in your Facebook or LinkedIn profiles.#47Write down your passwords and hide them; tell one person where they are.#48Don’t fight demographics—allocate a portion of your portfolio to health care and biotech stocks.#49Diversify globally to boost your portfolio’s risk-adjusted performance.#50Benjamin Graham: “Speculation is neither illegal, immoral nor (for most people) fattening tothe pocketbook.”#51Cash in on companies with stealth dividends—meaning stock buybacks.#52Diversify, but don’t overdo it.#53Set investing rules for yourself that block impulsive decisions.#54Look beneath a fund’s name, with Morningstar’s Style Box and X-ray.#55Use software to track your asset allocation.#56Ask for a “brokerage window” in your 401(k)—an opening that allows you to invest in any mutual fund and even individual stocks.#57Bond laddering is good, but diversifying your income investments is important, too.#58Treasury Inflation-Protected Securities (TIPS) offer protection from inflation—not from rising interest rates.#59John Bogle: “Time is your friend. Impulse is your enemy.”#60Use salary increases to boost contributions to your 401(k).#62Defy conventional wisdom and increase your stock allocation after retirement.#63To make money in small-cap stocks, look for novel business methods and niches, not the next blockbuster drug.#64Don’t abdicate investment decisions to your spouse.#65Be suspicious—and investigate further—when a corporation changes its auditors.#66Carry a $2 million or bigger umbrella insurance policy to protect your wealth from liability suits.#67Warren Buffett: “Be fearful when others are greedy, and be greedy when others are fearful.”#68Invest to meet goals, not to beat indexes.#69Clarify your own objectives by writing an Investment Policy Statement.#70When you get restricted stock in a startup, make an 83(b) election; if the company takes off, you’ll save big on taxes.#71Consider your marriage tax penalty (or bonus) before setting a wedding date.#72Aim to have five times your salary in your 401(k) and IRAs by age 55 and eight times before you retire.#73Dan Ariely: “If you can’t save money, be really nice to your kids.”#74Put peer-to-peer loans in your portfolio using sites like The Leader in Peer to Peer Lending: Loans and Investing for monthly cash flow and yields of from 7% to 9%.#75Peter Lynch: “Go for a business that any idiot can run—because sooner or later, any idiot is probably going to run it.”#76Never take on a mortgage just for the tax deduction.#77Keep no more than $250,000 in any one bank.#78Buy an index fund weighted to fundamentals.#79Remain anonymous after winning the Powerball jackpot.#80Work for a charity for ten years and get your federal student debt forgiven.#81Beware personal finance gurus pitching products.#82The most successful investors spend many hours at it each day and have passion and patience. There are no shortcuts.#83Warren Buffett: “Diversification is protection against ignorance.”#84Like Captain Kirk, have advisors from different planets.#85Before funding college accounts make sure you’re saving enough in your retirement accounts.#86To avoid a tax penalty, tap IRAs, not 401(k)s, to pay college tuition.#87Borrow from grandma at 4% for grad school; Uncle Sam’s Graduate Plus loans go for 6.41%.#88Marry a billionaire, or perhaps even more rewarding, divorce one.#89When buying a luxury condo, ignore superfluous amenities like massage rooms and pet spas; they won’t contribute to resale value.#90Add commercial real estate to your portfolio.#91Wait for inflation to rise before buying TIPS.#92Howard Marks: “Rule number one: Most things will prove to be cyclical. Rule number two: Some of the greatest opportunities for gain and loss come when other people forget rule number one.”#93Before remarriage, discuss estate plans.#94Track gambling losses to offset taxable gambling winnings.#95Confess any tax crimes to a lawyer, not a CPA.#96Deduct your yacht loan as mortgage interest on a second home.#97Don’t do deals between yourself and your own IRA.#98Don’t roll your old 401(k) into an IRA if you might face a lawsuit.#99When creating a trust or family limited partnership for asset protection, don’t give it your own name or one obviously identified with you.#100Profit from stock market volatility: Buy into a VIX futures fund and use wild, seemingly irrational swings as buying opportunities.#101Gary Shilling: “The market can remain irrational longer than you can remain solvent.”#102Beware dividend traps—fat payouts supported by declining cash flow.#103Bet against weak currencies, like George Soros.#104Back up your financial records using a secure cloud service.#105Before investing in your own state’s 529, compare its fees and tax breaks to New York’s rock-bottom cost plan.#106Buy liens on homes of real estate tax deadbeats.#107Know thyself: Read books like Dan Ariely’s Predictably Irrational and Your Money & Your Brain by Jason Zweig.#108Learn a lesson from each stock-picking mistake.#109Julian Robertson: “Buy into forgotten markets.”#110Join an angel investing club.#111Keep your own entrepreneurial options open by refusing to sign onerous noncompete agreements.#112Buy stocks of companies still controlled by their billionaire founders.#113Leon Black: Do your homework, but still don’t bet the ranch.#114Louis Bacon: “As a speculator you must embrace disorder and chaos.”#115Almost all great value investors look for market anomalies or disconnects that they can exploit.#116Warren Buffett: “Big opportunities come infrequently. When it’s raining gold, reach for a bucket, not a thimble.”#117Always keep some investment powder dry.#118Allocate investments against your life risks.#119Andrew Tobias: “A penny saved is two (pretax) pennies earned.”#120Deduct losses from your sideline/hobby by bunching your expenses and showing a small profit in 3 of 5 years.#121Postpone real estate gains tax with a 1031 exchange.#122Qualify as a “real estate professional” to save big on taxes.#123Be leery of investments sold for tax savings.#124Burton Malkiel: “Start saving now, not later: Time is money.”#125Before making a big discretionary purchase, calculate future cost—what the dollars you’re spending could grow to if invested for 20 or 30 years.#126Read How to Make Money in Stocks by William J. O’Neil.#127Buy designer goods at consignment shops; when you get bored with them, sell for a profit on eBay.#128Discuss any prenuptial agreement way in advance of your wedding.#129Hell hath no fury. Never cheat on your taxes and your spouse at the same time—exes are a big source of IRS leads.#130Don’t buy a large amount of a thinly traded stock all at once.#131Buy and hold at your own risk.#133Don’t be afraid to buy into strength.#134It’s okay to chase performance—sometimes.#135Burton Malkiel: “In the stock market, past is not prologue.”#136Start a 529 college savings plan for yourself before you have children. If you don’t use it for graduate school, transfer it to your kid.#137Make your kid rich by helping him fund a Roth IRA.#138Deplete Junior’s UTMA—you can spend it on a laptop, camps, private school and tutoring—before applying for college financial aid.#139Reduce your student loan interest rate with auto debit.#140Julian Robertson: Suggest your kid take an accounting course—“It was the course that helped me more than anything.”#141Robert Shiller: “If you want to get rich, go into finance or a related field. Finance is the technology for making things happen.”#142Identify companies that gouge you yet keep your business. Buy them.#143Buy stocks like socks—good quality on sale.#144Buy into big ideas just like a global macro hedge fund for as little as $1,000 to start.#145Use limit orders when buying small-company stocks with low trading volume.#146Don’t leave it all in the dollar. Invest globally for currency diversification.#147Dollar-cost average the whole stock market.#148Buy companies with high ratios of gross profits-to-total assets.#149John Neff: “Buy on the cannons and sell on the trumpets.”#150Monitor your individual stocks; set a Google news alert and watch for signs of possible trouble.#151Bone up on “risk parity” diversification.#152Always know how a financial advisor is getting paid and what if any commissions she’ll earn.#153Watch out for paid shills at investment seminars.#154Ken Fisher: “You know who didn’t have bad years? Bernard Madoff—until he got caught.”#155Buy a retirement annuity cheap by delaying Social Security until 70.#156If you need to tap retirement cash early, study up on the exceptions that let you avoid a 10% penalty, including taking “substantially equal periodic payments.”#157Burton Malkiel: “Tune out the financial TV channels. Watch the cooking channel or the gardening channel if you want useful advice.”#158Warren Buffett: “Returns decrease as motion increases.’’#159Ron Baron: “Don’t waste your time short-selling. Show me the short-sellers’ yachts.”#160If you earn too much to contribute to a Roth IRA, fund a nondeductible IRA and convert it.#161If divorcing, get a “QDRO” from the court that allows you to split retirement assets without owing immediate tax.#162Claim the American Opportunity Tax Credit for your kid’s college—if you’re eligible.#163Don’t make multiple $9,900 bank deposits—the government might seize your money and keep it on the grounds you’re trying to skirt anti-money-laundering laws.#164Do a bond fund swap to harvest tax losses.#165Gain funding—and a market—on Kickstarter.#166Barry Ritholtz: “Never confuse investing with trading.”#167Don’t let the tax tail wag the investment dog.#168Hold illiquid assets in a Roth IRA, not a regular IRA.#169Be like Peter Thiel and put hot startup stock in a Roth IRA to make all gains tax free.#170Learn about your fiancé’s debts, before you walk down the aisle.#171Beware high-yield investments pitched as being like a bank CD.#172Watch out for stock hoaxes on Twitter.#173Be leery of pitches involving a self-directed IRA.#174Benjamin Graham: “It is absurd to think that the general public can ever make money out of market forecasts. For who will buy when the general public, at a given signal, rushes to sell out at a profit?”#175Avoid sudden lifestyle changes after a windfall.#176Automatically divert money from your paycheck into savings to the point where it hurts.#177Retire to a place without state estate or inheritance taxes.#178Benefit from 20/20 stock market hindsight by reversing a Roth conversion if stocks tank.#179Donald Trump: “Sometimes your best investments are the ones you don’t make.”#180Ben Stein: Don’t move into a neighborhood of poverty. Avoid any situation that could leave you with too much unsecured debt.#181Get an entrepreneur mentor from SCORE, an organization of retired business folks.#182Tap your ethnic community for business funding.#183To get the best effort and thinking from employees in your startup, give them stock options.#184Like Spanx’s Sara Blakely, solve an irritating problem.#185Larry Page: “It is often easier to make progress on mega-ambitious dreams. …Since no one else is crazy enough to do it, you have little competition.”#186Don’t blindly rely on a target date fund in your 401(k).#187Don’t let your advisor manage you.#188Don’t rely on regulators to protect you from financial fraud.#189Warren Buffett: “What is smart at one price is dumb at another.”#190With large-cap stocks, focus more on cash flow than earnings.#191Strong stocks tend to stay that way. Buy high and sell higher.#192Don’t let family wealth become a curse on your children.#193Start your kid at the bottom of your business.#194Read Common Stocks and Uncommon Profits by Philip A. Fisher.#195Buy a gift annuity from your alma mater.#196John Neff: “When you feel like bragging, it’s probably time to sell.”#197Mine your closet for eBay gold.#198Mine your network for investment ideas.#199Warren Buffett: “The risks of being out of the game are huge compared to the risks of being in it.”#200Sell put options like Warren Buffett does.#201Buy stocks when a magazine cover declares “The Death of Equities.”#202Don’t count on an inheritance. If you get one, don’t blow it.#203Leon Cooperman: “Getting rich takes hard work, a passion for what you do and luck.”#204If you win the Powerball jackpot, hire a tax advisor before making any decisions.#205Hunt down pensions from old employers.#206If you’re 50 or older, with substantial self-employment income, use a custom-designed defined benefit plan to shelter $100,000 a year or more from tax.#207Max out your 401(k) contributions: In 2014 you can contribute $17,500, or $23,000 if you’re 50-plus.#208If your marriage is shaky, make a copy of all financial documents.#209If your spouse is shady, file separate tax returns.#210Burton Malkiel: “Never buy anything from someone who is out of breath.”#211Know when to fire your financial advisor.#212Be skeptical of “principal protected” products—ask how much is guaranteed and at what cost.#213Be wary of companies that have gone public in reverse mergers.#214Low-priced stocks aren’t necessarily cheap.#215Make sure a stock’s dividends are less than its cash flow and likely to remain that way.#216Warren Buffett: “Risk comes from not knowing what you’re doing.”#217Beware unlisted REITs.#218Save remodeling receipts to add to your home’s basis and cut gains taxes when you sell.#219Buy no more house than you can afford.#220Don’t accept a high property tax assessment of your home—you can appeal andtalk it down.#221Don’t assume you should buy a house. Start by calculating rent-versus-buy costs for homes in your market.#222If you have no time for complexity, diversify your portfolio with just three mutual funds.#223Buy a deferred fixed annuity to make sure you don’t outlive your money.#224Build your own ersatz retirement annuity with savings bonds.#225Boost income with closed-end, covered call funds.#226Burton Malkiel: “Trust in time, rather than timing.”#227Delay retirement as long as you can.#228But don’t assume in your planning that you can work full-time until 70.#229Compare insurance costs before choosing a new car model.#230Then go shopping for that model at month’s end.#231To save even more, don’t own a car, share one.#232Hold actively managed mutual funds—the kind that pass on the most-short-term gains—in tax-deferred retirement accounts.#233Hold real estate in your IRA—but carefully.#234Don’t let the groupthink of investment clubs cloud rational investment analysis.#235Warren Buffett: “Diversification is a protection against ignorance.”#236Follow top money-manager moves. Even the great investors piggyback on other smart investors.#237David Dreman: “The time to buy is when there’s blood on the streets.”#238Beware superstar CEOs with weak boards.#239Compare benefits (including options) before switching jobs.#240Find out how your 401(k) rates at Financial Planning Advice, Find a Financial Advisor, and 401k Plan Ratings | BrightScope; if expenses are high or fund choices poor, lobby for a better plan.#241Don’t give Uncle Sam an interest-free loan; adjust your withholding so you don’t overpay your taxes.#242Even if you can’t pay, file your tax return.#243Take a cue from Mark Zuckerberg: Get maximum tax savings for your charitable buck by giving appreciated assets to a donor-advised fund or supporting organization.#244Read Market Wizards and The New Market Wizards by Jack D. Schwager.#245Warren Buffett: “Time is the friend of the wonderful business, the enemy of the mediocre.”#246Don’t chase yesterday’s winners unless they’re still winning.#247Purchase “own occupation” disability insurance.#248Remember that market underperformance—just like costs—compounds.#249Ramit Sethi: Set up systems to automate desired behaviors. Leave your gym clothes at the foot of your bed. Have contributions to savings automatically deducted.#250Open a spousal IRA for a stay-at-home husband or wife.#251If you work from home, get a rider on your homeowner’s insurance policy to protect you if the FedEx man slips.#252To maximize college aid, make Roth 401(k) contributions, not pretax ones, while your kids are in college.#253Like Warren Buffett, make concentrated bets in stocks that you have high confidence in.#254Live dangerously; invest your emergency fund instead of keeping it in cash.#255Barry Sternlicht: Study outliers rather than eliminate them. You can learn everything thereis to know about the industry or the player from the company that is performing better or worse.#256Don’t wait until expiration. Always look to buy back cheap options.#257Most stock market gains since 1950 have occurred in the November-Aprilperiod.#258Over the long run, small-cap stocks have outperformed big blue chips.#259Take only calculated risks on the smallest Pink Sheet stocks.#260Move inherited IRAs from trustee to trustee only.#261Name primary and contingent IRA beneficiaries so your heirs can enjoy the maximum years of tax deferral.#262Maximize your Social Security using a couples claiming strategy.#263Open all mail from the IRS.#264Don’t cheat the IRS and your business partner at the same time.#265Never ignore a 1099, even if it’s wrong—the IRS won’t.#266Don’t lie to your tax pro.#267After you hit 70, take the required minimum distributions (RMD) each year from your traditional IRAs or face near-confiscatory tax penalties.#268If you don’t need your RMD, consider rolling it directly to a charity.#269Sign a living will, health care proxy and power of attorney, even if you’re still healthy.#270Get a will. What happens to property if someone dies without one (intestate) varies by state and might not be what you would want.#272Warren Buffett: “No matter how serene today may be, tomorrow is always uncertain.”#273Insure your home for its replacement value; buy flood insurance if there’s a risk of water damage.#274Scan in your tax records, and keep a copy on the cloud or on an external drive at work; fires and floods happen.#275Keep business and personal expenses separate.#276Maintain at least some financial accounts separate from your spouse’s.#277Peter Lynch: “Know what you own and know why you own it.”#278Have your kid read The Little Book That Beats the Market by Joel Greenblatt.#279Don’t fall for cheap stocks that are really worth even less.#280Read the classic Where Are the Customers’ Yachts? by Fred Schwed Jr.#281Run from a pitchman “guaranteeing” high returns.#282Benjamin Graham: Speculate only with a separate small portion of your capital.#283Snitch on tax cheats and collect a multimillion-dollar IRS whistle-blower award.#284Learn what behavioral economists have found about self-destructive investor behavior—so you can try to avoid these common and expensive mistakes.#285Understand the risks of using leverage and inverse ETFs, which rebalance assets daily.#286Benjamin Graham: “Every nonprofessional who operates on margin … is ipso facto speculating.”#287Register for Medicare at 65, even if you’re still covered by your workplace insurance, to avoid having to pay a penalty later.#288Rob Arnott: “No strategy can make up for inadequate savings or premature retirement.”#289Start saving for retirement in your 20s to put the compounding winds at your back.#290Use the Rule of 72: Divide your expected percentage return into 72 to figure how long it will take you to double your money.#291Never sell a stock that keeps on rising in price.#292Warren Buffett: “When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”#293Ben Franklin: “An investment in knowledge pays the best interest.”#294Use ETFs to be your own international fund manager.#295Don’t try to impose your ego on the market.#296Set up 10% trailing stop-loss orders to avoid unexpected nosedives in your portfolio.#297Barry Sternlicht: You have to be willing to change your mind. If you are a stubborn mule, you’ll get killed.#298Read Warren Buffett’s favorite book, Benjamin Graham’s Intelligent Investor.#299Be a vulture investor: Buy distressed bonds at pennies on the dollar like Marty Whitman and David Tepper.#300Pay attention to moving averages. When the 20- or 50-day average crosses below the 200-day average it’s bearish.#301Monitor the level of fear in the market with the CBOE put/call ratio and theVIX.#302Get tax help if you’ve got incentive stock options—they carry tax benefits but also a nasty alternative minimum tax trap.#303Pay public school tuition for your overachieving teen by getting steep discounts at great private colleges.#304Don’t treat your 401(k) as a piggy bank; you’ll regret it come retirement.#305Read Money Masters of Our Time by John Train.#306Never buy anything from a cold-calling broker.#307Be alert for the signs that a bubble is forming.#308Use sentiment indicators as contrarian tools.#309Don’t confuse correlation with causation in markets.#310Small-cap stocks with lower price-to-book values tend to outperform.#311Tap an IRA—not a 401(k)—without penalty for a first-time home purchase.#312Leave the dollars in a Health Savings Account growing tax free for retirement while you cover medical deductibles and copays from your current income.#313Use a “flight path” approach to asset allocation, raising your exposure to stocks as you become a more confident investor.#314Know your sell rules before you buy.#315Read letters of great investors such as Warren Buffett and Jeremy Grantham online.#316Become an online stock researcher.#317Beware of asset protection scams.#318When stuck paying AMT, accelerate some income.#319Rent out your vacation home for two weeks a year, tax free.#320Most people don’t need a whole life policy; buy a 20-year level-premium life insurance policy before your first child is born.#321Warren Buffett: “You only find out who is swimming naked when the tide goes out.”#322Save $40,000 or more by sending your overachiever to community college and then have her transfer to a top public university or the Ivy League.#323Save on a master’s—for yourself or kids—by earning it in Britain in one year.#324Have your eldest child take a gap year before college so that more than one child is in school at the same time—you’ll get more financial aid.#325Rothify—Roth conversions make sense in more cases than most people realize.#326Time 401(k) contributions to make sure you grab your full employer match.#327Factor your individual health and life expectancy into your decision on when to take Social Security.#328Use an online calculator to help you determine the best strategy to maximize your Social Security benefits.#329Put junk bond funds in tax-deferred accounts.#330If your spouse dies, file an estate tax return to preserve his $5.25 million estate/gift tax exemption (rising to $5.34 million in 2014) for your own use later.#331Buy master limited partnerships late in life to avoid their tax drawbacks.#332Only buy closed-end funds trading at discounts to net asset value.#333Invest in businesses with sustainable competitive advantages.#334Don’t fight the tape.#335Remember, three out of four stocks follow the market’s overall trend.#337Spend 25% less than you make—it will give you flexibility to pursue the big opportunity.#338Bruce Greenwald: To get really rich, copy the hedge fund, private equity and VC masters and “get your hands on somebody else’s money.”#339Warren Buffett: “Investors should remember that excitement and expenses are their enemies.”#340Watch out for high fees hidden in some tax-sheltered products like 529s and variable annuities.#341Protect your assets before there’s a claim against you; after-the-fact moves can backfire.#342Check your advisor’s ADV at www.sec.gov.#343Remember Bernie Madoff: Make sure your investment advisor keeps your money in an account with an independent custodian.#344Gary Shilling: Don’t try to reinvent the wheel. Instead, intelligently and efficiently apply what is already well known.#345Warren Buffett: “You don’t have to make money back the same way you lost it.”#346When selling a business, plan ahead and you may be able to save big on tax.#347Retire to a place where jobs are plentiful.#348Factor taxes into your retirement income strategy.#349Take $500,000 per couple in gains on the sale of your home, tax free.#350Don’t be afraid to deduct a legitimate home office—you can now claim up to $1,500 a year, with minimal recordkeeping.#351Review the assumptions an ex-employer has made in calculating your pension. Mistakes aren’t unusual.#352Keep 5% of your portfolio in gold.#353Own gold through ETFs like GLD.#354When pundits declare the death of “buy-and-hold” it could well be the sign of a market bottom.#355Warren Buffett: “It’s optimism that is the enemy of the rational buyer.”#356Burton Malkiel: “ ‘Efficient markets’ does not mean that the price of every security at every moment in time is correct.”#357Look for undiscovered stocks with market caps between $1 billion and $10 billion.#358Understand how the businesses you invest in make money.#359If the short sellers are swarming around your stock, investigate the bears’ thesis.#360When company insiders buy, you should, too.#361Benjamin Graham: Those who want “freedom from concern” must accept lower returns.#362Warren Buffett: It is “far better to buy a wonderful business at a fair price than to buy a fair business at a wonderful price.”#363Burton Malkiel: “Avoid the temptation to follow the herd.”#364Steve Jobs: “Your time is limited, so don’t waste it living someone else’s life.”#365Plan.I hope this helps.

Hi,First let me say congratulations. The fact that your are thinking about saving at 18 years old puts you WAY ahead of the curve. I've read through some of the posts below and there's a lot of great advice but a few key points are missing. I won't address them right away, I’ll start by suggesting some helpful resources like the people below, ask you to check out the links below and fill out the savings tool and cash flow analysis, then talk about what the purpose of investing is.1. I started learning about investing from #MotleyFool and MSNmoney. Motley is a great resource because you can search individual stocks, read articles about different parts of the economy (tech, resource, financial, etc) and learn the basics of investing such as time horizons, risk tolerance, FMV, to name a few. I'll describe some of these below. Lastly, search on Twitter. There's 100's if not 1000's of news papers and companies to follow. Just be careful not to get caught up in the day to day hype. A good investing strategy will weather the storm.2. Go here Scotiabank TFSA and play around. The rate of return is the amount your investments will grow by (on average). There's a million different stocks you can choose but let's say you're investing in growth #mutual funds, a rate of 7% is normal. 3% is good for less risky. Next go here Money Finder Calculator | Scotiabank to find out how much money you have left over each month to invest. You can use that amount for the scotiabank calculator and see how much it'll be worth when you retire.3. That cash flow calculator is KEY. It will tell you how much you can save without spreading yourself too thin. There were a lot of suggestions below about what to invest in but there's no magic formula. No get rich quick. While it's true some people made millions by investing in a certain stock, man many more have lost everything trying to find the one that hits. Forget it. To figure out what type of investments are right for you need to know how long you intend to invest (time horizon). If it's under 2 years - don't do it. Just sock away money in a savings account. After the two year mark, the longer you invest the more risk you can accept (risk tolerance). Next, ask yourself what you are looking to accomplish by investing. Do you want to be paid a small sum each month? Are you looking to aggressively grow your money over the long term or pay for school in 5 years? These things will give you a basic idea about what sort of investments are good for you.4. Because you are new to investing I would recommend you speak to an advisor at your bank. They don't charge fees to buy and sell (double-check) and you can put together an investment strategy to build your wealth over time. I would not recommend you invest by yourself with programs like iTrade. Leave that for when you are more confident.5. You can start investing in mutual funds, which fluctuate less than stock, for as little as $50 per month. Set up a payment plan where you invest a small amount every pay. This is called dollar cost averaging and is a great way to start.